Excess Mileage Default - Claim to remove marker

[Highlander777]

Hi

i VT my BMW last year. Told BMW I would not paid excess mileage about £400

went to buy some goods and with 0% loan and was refused. They used Experian so I called them and they said I had a red marker against BMW for non payment.

What are my options as Experian say it will be on my record for 6years even I pay the excess mileage

thanks

[R0b]

Re: BMWFS VT Process (Aug '16)

Hi

i VT my BMW last year. Told BMW I would not paid excess mileage about £400

went to buy some goods and with 0% loan and was refused. They used Experian so I called them and they said I had a red marker against BMW for non payment.

What are my options as Experian say it will be on my record for 6years even I pay the excess mileage

thanks

Hello Highlander, if they have not closed your account off and there seems to be an outstanding balance due to the excess mileage, then your only way of having it removed would be to go to court as a breach of data protection for inaccurate information being posted. I do know that BMW have instructed solicitors before when someone on here threatened to recover excess mileage charges but ultimately backed down and didn't want to take it further.

The only way it will be removed is if the court agrees and acknowledges that they shouldn't have put the marker on in the first place, and you might get some compensation as a result of that.

[Highlander777]

Re: BMWFS VT Process (Aug '16)

hi

thanks

so, are BMW in breach of data protection for inaccurate information being posted by making it red in Experian for non-payment of excess mileage..??. if yes, sounds like I have a case ?. do you have anymore data where BMW backed down and why?

thanks

[R0b]

Re: BMWFS VT Process (Aug '16)

hi

thanks

so, are BMW in breach of data protection for inaccurate information being posted by making it red in Experian for non-payment of excess mileage..??. if yes, sounds like I have a case ?. do you have anymore data where BMW backed down and why?

thanks

Potentially they are yes. When you VT, any outstanding balance accrued before the termination is not affected by the VT. Section 100 of the CCA goes on to limit the liability to 50% of the total amount payable but that does not include compensation for breaches of the agreement. The 50% liability does not cover outstanding arrears (because they accrued before termination) so that would be payable in addition.

What normally happens is when the car is handed back they check the mileage and if it is over the stipulated amount, the finance company will send an invoice for it. They can't claim for it because it has only accrued after the termination of the agreement when they were able to check the mileage on the car and work out the excess.

The only way I can see you being able to be charged for excess mileage before the VT is if the finance company or an agent comes out to carry out an inspection and records the mileage at the same time. If the mileage is above the yearly quota then they could accrue and bill you for it. If you've not paid it by the time you VT, then you are liable for that excess mileage.

The only other alternative I can think of at the moment would be for the terms to stipulate that the excess mileage accrues before termination. However there is a problem with this because s.100 limits liability and does not include breaches of the agreement and is a deliberate attempt to circumvent that liability. Equally, if the excess mileage is to accrue before the termination, BMW must have to know what that amount is prior to the VT. If they don't know how much you have exceeded the agreed mileage, then to my mind it couldn't have accrued prior to termination. This line of argument is probably one for a court to decide I think.

[Highlander777]

Re: BMWFS VT Process (Aug '16)

Hi

thanks for the reply. I am struggling somewhat with your reply. so have summarised below

1. I VT my BMW over 12 months ago. I had made over 50% of my payments. I also paid some wear and tear costs as requested by BMW. when I returned the paperwork, I made it clear that I would not pay any further costs including excess mileage. this was hand written on their paperwork
2. 12 months on , I discover there is a red marker against my name on my Experian report and Experian will not remove as BMW say its valid and below is what they provided to Experian

Theexcess mileage charge has been disputed via our Customer Escalationsdepartment. The dispute was rejected and our Final response has been issued.The amount of £282.46 remains due on the agreement

my options

1. if I was to pay the £282 to BMW, Experian are saying the marker will remain on my file for 6 years !!

there seems to be 2 issues I can potential fight

1. there is ambiguity between the termination clauses
2. have BMW mis informed Experian ?

I feel that I have no choice but to take action and inform BMW that I will take them to court. can you please provide some guidance on my next steps , such as appoint a solicitor to send an official letter to BMW ?

thanks

[R0b]

Re: BMWFS VT Process (Aug '16)

First thing you should do is read the agreement and see what it says, if you are struggling you can post up the terms of the agreement and I will take a look for you.

the main arguments for taking them to court is that:

1. They were not entitled to mark as a default, because the alleged debt did not relate to the credit provided under the agreement. You have not missed any of the credit repayments and so they have no right to apply a default marker.
2. Even if the court finds that the marker could be applied, you never received any default notice correspondence and as a result means they haven't complied with their obligations so it cannot be applied (only applicable if not received letters)
3. Your liability was limited to 50% of the total amount payable under the contract as well as any outstanding arrears, therefore claims for excess mileage is specifically excluded by way of the Consumer Credit Act 1974.
4. The clauses under the contract are ambiguous and therefore the the 'contra proferentum' rule applies (ambiguous clauses are construed against the party who drafted them).
5. Possible other claims that I can't think of right now

You may wish to consult a solicitor but as it is in the small claims court you are not going to get your costs back and will inevitably cost more than you are claiming. If you are claiming up to £300 in damages and the removal of the default marker the claim will only set you back £50 altogether.

I believe the previous person who wanted to bring a claim for recovery of the excess mileage sums he paid which was slightly different to yours. The referred to their solicitors and suggested if a claim was made then they would seek to recover costs against him. Small Claims attract fixed costs and are severely limited, the only way you can be awarded additional costs against you is if your claim is vexatious or frivolous. This particular issue requires a decision by a court on a particular point of law. On that basis I can't see how any claim would be vexatious. You can read the link here -> http://www.legalbeagles.info/forums/...t=malt+vinegar

Again, going to court is a game of chance sometimes and not always a winnable case, it is up to you if you feel it warrants legal action.

Before you commence legal proceedings you need to send a letter before action, outlining your claim and what action you require to be taken.

Happy to assist if you need to

[Highlander777]

Re: BMWFS VT Process (Aug '16)

yes please . would like your help in drafting a letter to send to BMW FS. I do like your use of language , 'contra proferentum'. had to look it up on Wikipedia

regards

[R0b]

Re: BMWFS VT Process (Aug '16)

yes please . would like your help in drafting a letter to send to BMW FS. I do like your use of language , 'contra proferentum'. had to look it up on Wikipedia

regards

Simply an old english word for ambiguous terms of the contract I've moved your posts to a new thread so we can keep track of this more easily.

If you are wanting to go down this route then as I have said your first port of call would be to draft a letter before claim. I am assuming that your agreement contains the same clauses as the one below e.g. Termination: Your Rights?



If so, then the contents of the letter should include the following:

1. Heading in bold something like "Letter Before Action: Breach of Principle 4 of the Data Protection Act 1998 relating to a Hire Purchase Agreement"
2. Insert Agreement no. and vehicle make/model and registration number if you can recall
3. Brief background as to how this issue has come about e.g. you terminated your agreement on or around XX XX XXXX by way of voluntary termination, the vehicle returned. You received no further correspondence and upon applying for credit/mortgage you became aware of default on file for excess mileage.
4. Explain the reasons why you believe BMW is in breach of DPA and why the default should not be on file. This is where you explain why it is unlawful including, but not limited to:
- The excess mileage does not form part of the total credit under the agreement
- Your liability is restricted to 50% pursuant to section 100 of the Consumer Credit Act 1974
- Under the terms of the agreement it states that provided I have paid XXXX and taken reasonable care of the goods I do not owe anything else. You relied on that clause and have fully complied with it, therefore you do not owe anything else.
5. You need to explain what action you need to be taken e.g. removal of the default marker within 7 days from the date of this agreement (and perhaps a sum for compensation as a result of breach).
6. Should they fail to comply then you will have no choice but to issue legal proceedings without further notice

Have a stab at writing something and post up here if you like, I can provide some feedback once you are done.

[Highlander777]

Re: BMWFS VT Process (Aug '16)

Hi

thanks for the above. sorry for the delay. I have been out of the country on business

I have been going through my paperwork and found this letter from BMW. when I received it , I did not pay too much attention to it as I has applied for a car loan to fund my new car and was accepted , so assumed there was not issue with my credit rating.

I have attached the letter from BMW. I wanted to check that this does not affect me writing a letter as you have outlined above ?

thanks

[R0b]

Re: BMWFS VT Process (Aug '16)

[ATTACH=CONFIG]26508[/ATTACH]Hi

thanks for the above. sorry for the delay. I have been out of the country on business

I have been going through my paperwork and found this letter from BMW. when I received it , I did not pay too much attention to it as I has applied for a car loan to fund my new car and was accepted , so assumed there was not issue with my credit rating.

I have attached the letter from BMW. I wanted to check that this does not affect me writing a letter as you have outlined above ?

thanks

Hello, no it doesn't its the standard response from BMW I think.

[Highlander777]

Re: BMWFS VT Process (Aug '16)

Hi - I have drafted a letter below for review and comment

I would like to raise something else in relation to this . back in Nov 2015, BMW issued me with a cheque for £1,066.72. from memory, this was due to BMWFS overcharging me on interest, although it was not clear. when I called BMWFS they were not able to provide me with an explanation and even stated that they had no record of the cheque and I have that in writing from BMWFS. I am wondering if this is worth raising too?


Dear Sir/Madam
Letter Before Action: Breach of Principle 4 of the DataProtection Act 1998 relating to a Hire Purchase Agreement
Agreement No:
Vehicle Registration
Back in October 2015, I Voluntary Terminated my BMW. I returnedthe car and paid the outstanding wear and tear costs and considered the matterclosed. I recently applied for a loan and was rejected. I contacted Experian asthe shop used them to check my credit file. An agent from Experian explainedthat I had a red marker against my name for non-payments to BMW FinancialServices ( BMWFS).
BMWFS is in breach of the Data Protection Act and thecurrent red marker against my name should not be on file. This is unlawful forthe following reasons;
·The Excess mileage does not form part of thetotal credit under the agreement
·My liability is restricted to 50% pursuant tothe section 100 of the Consumer Credit Act 1974
·Under the terms of the agreement it states thatprovided I had paid £2xxxx and taken reasonable care of the goods I do not oweanything else
I want my marker permanently removed from Experian and anyother organisation that may have a negative marker against relation to thisagreement within 10 days and £500 compensation because of the breach.
If BMWFS fail tocomply, then I will no choice but to issue legal proceedings without furthernotice
Regards

[R0b]

Re: Excess Mileage Default - Claim to remove marker

It seems fine, though I would suggest rephrasing the excess mileage to say something like "the Excess Mileage charges do not form monthly instalments nor the total amount payable under the agreement"

Though there is nothing wrong with stating 10 days to remedy the issue, I would probably give them 14 as that is generally the standard position of a reasonable time.

You may also want to add to the end of the £500 compensation for breach of the DPA and distress.


Other than that, looks fine though I expect them to instruct solicitors to respond and/or defend the claim so be sure you are going to follow through with it.

[Highlander777]

Re: Excess Mileage Default - Claim to remove marker

hello - I got this reply from BMW . Thoughts on how to reply

Dear Mr McDermott

Thank you for your email of 2 February.

I have spoken with our post department who haveconfirmed that your letter was passed to our Customer Escalations team toreview. Unfortunately their team are experiencing high volumes of calls andcorrespondence therefore I am sorry that you had not yet had a response.

I can see from our records that your complaintwas fully investigated by their department and a final response was issued toyou on 15 April 2016. Had you remained dissatisfied with this response, you hadthe right to refer your complaint to the Financial Ombudsman Service free ofcharge within 6 months of our response. As this time has passed, they will nothave our permission to review your complaint.

You have referred to your rights whenexercising a Voluntary Termination however, both the agreement you signed andthe Consumer Credit Act should be considered as a whole and all subsectionswithin it. Excess Mileage is chargeable under section 99 (2) of the ConsumerCredit Act which specifically states that any pre-termination liability is notaffected by termination. As the excess mileage has been accrued prior to thetermination of the agreement it is recoverable under this provision. Had themileage been stated correctly at inception of the agreement, your monthlyrentals would have been calculated at a higher rate and you would have beenpaying over the term of the agreement. As you exceeded the agreed mileage, BMWFinancial Services have incurred a loss to the value of the vehicle and arewithin our rights to seek compensation for this.

The charge is contractual and therefore we mustreport factually to the Credit Reference Agencies when this charge remainsunpaid. If you would like your Credit File to be updated, we require thebalance of £282.46 to be paid in full and we will then report that theagreement has been fully settled.

I appreciate that this may not be the responseyou were hoping for but I hope the above helps to clarify our final responseand our reporting. Any further correspondence disputing the same will be readbut not responded to.

Yours sincerely

BMW Financial Services
Natalie Mason
Recovery Advisor
Summit ONE
Summit Avenue
Farnborough
Hampshire

[R0b]

Re: Excess Mileage Default - Claim to remove marker

Excess Mileage is chargeable under section 99 (2) of the Consumer Credit Act which specifically states that any pre-termination liability is not affected by termination. As the excess mileage has been accrued prior to the termination of the agreement it is recoverable under this provision.

Whilst that statement that s.99(2) allows charges accrued before termination to become recoverable, it is not entirely accurate that the excess mileage charges can be recovered.

Section 99 and 100 need to be read together to fully understand a debtor's liability. S.100(1) says: #

Where a regulated hire-purchase or regulated conditional sale agreement is terminated under section 99 the debtor shall be liable to pay to the creditor ...

one half of the total price ... and the sums due in respect of the total price immediately before the termination

The key focus are the words 'total price' which are defined in section 189 of the CCA as:

the total sum payable by the debtor under a hire-purchase agreement or a conditional sale agreement, including any sum payable on the exercise of an option to purchase, but excluding any sum payable as a penalty or as compensation or damages for a breach of the agreement

So, your liability under s.100(1) is half of the total amount payable under the agreement, which includes the sum for the option to purchase plus any outstanding instalments that were due before termination. Excess mileage charges would fall within the compensation/damages category and the CCA excludes such charges from being recovered.

I've provided a scenario of how it should work in practice, though lenders will argue otherwise to those who don't know their rights and are not legally trained.

Debtor enters into a HP agreement where the total amount payable is £10,000. He has paid £4,120 so far and there is one monthly instalment outstanding of £130, and deciding he can no longer afford the repayments he terminates under section 99. He also went over his pro-rata'd mileage which means that the finance company would charge him £115.
His liability under s.100 would therefore be £880 plus outstanding instalment of £130. Any contractual terms which state that he must pay more would be void because it exceeds the maximum liability provided for under s.100 of the CCA and in any event, as I have said above, excess mileage charges are excluded specifically from the 'total price' because they fall under damages for breaching the contractual terms.

As I read the email, they have suggested if you pay up then they will mark your credt file as 'fully settled' but does not indicate whether the default(s) will also be removed. You have sent a letter before action so it's now at a stalemate, and you either accept their position and pay up and hope they remove the adverse entries, or you take them to court and cite breach of data protection and/or negligence.

I can't tell you which way to go as it is your decision and you have to weigh up the risks, but if you do choose to go down the court route, I will assist where I can and I do have some templates which you could use to tailor your claim should you need it.

[Highlander777]

Re: Excess Mileage Default - Claim to remove marker

Hi

thanks for your continued support on this matter

my high level thoughts are.

I could pay up the outstanding amount , but when I called Experian and explained the situation . the response I got was even if I paid the outstanding amount they would still put a black mark against me for a further 5 years !!.

what are the risks of going to court, other than I lose money ?. will it be a negative and will I have to declare it when applying for future credit ?

As you say , it's seems to be a stalemate and I have to make the next move.

I am prepared to go to court but I do want to understand the risks + what is the next logical step
regards
john